Most land contracts are serviced illegally and most people do not know it. The Federal Dodd Frank law restricts the servicing of land contracts to 5 per individual. This is only allowed if the Land Contract or deed holder is an individual. If the holder is an LLC or other entity than they cannot be serviced by an individual. The state of Michigan is even more restrictive, the law in Michigan defines any owner financed sale as a mortgage and is therefore governed by the mortgage laws, including servicing.

In addition to just collecting monthly payments, the person originating the land contract must be able to verify that the purchaser is qualified to fulfill the contract and provide some underwriting proof. They must also provide an annual escrow audit report to the purchaser and a 1099-INT for interest paid. Even through there has been very little enforcement of these laws, a purchaser can file a case at any time against an illegal contract holder and possibly receive some compensation. The defendant in the case could also face fines and is responsible for all legal costs incurred by both sides of the suite.

Our servicing team can take over an existing Land Contract and start servicing it correctly or handle the entire process from start to finish with full underwriting and legal backing to protect the seller and land contract holder.

Success Group Mortgage provides for online payments for the purchaser and an account portal for the lender/holder. All annual reports and tax documents are provide. Late notices, escrow servicing, property tax payments, insurance monitoring, etc. all for $45.00 per month per contract. We can also provide discounted legal services in case of forfeiture or foreclosure.